Child Definition Simplification Act of 2004 - Amends the Internal Revenue Code to redefine "child" based upon residence, age, and relationship to the taxpayer, for purposes of the personal exemption, the dependent care credit, the child tax credit, the earned income credit, and the health insurance credit. Excludes any means-tested benefits received by a taxpayer under the Social Security Act or other substantially similar government programs from the tests for determining eligibility for the personal exemption and the dependent care credit and for determining marital status.
[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4132 Introduced in House (IH)]
108th CONGRESS
2d Session
H. R. 4132
To amend the Internal Revenue Code of 1986 to provide a uniform
definition of child for purposes of the personal exemption, the
dependent care credit, the child tax credit, the earned income credit,
and the health insurance refundable credit, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
April 2, 2004
Mr. Houghton introduced the following bill; which was referred to the
Committee on Ways and Means
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to provide a uniform
definition of child for purposes of the personal exemption, the
dependent care credit, the child tax credit, the earned income credit,
and the health insurance refundable credit, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Child Definition Simplification Act
of 2004''.
SEC. 2. UNIFORM DEFINITION OF CHILD.
(a) Personal Exemption.--
(1) In general.--Section 151 of the Internal Revenue Code
of 1986 is amended by redesignating subsections (c) and (d) as
subsections (d) and (e), respectively, and by inserting after
subsection (b) the following new subsection:
``(c) Additional Exemption for Qualifying Children.--
``(1) In general.--An exemption of the exemption amount for
each qualifying child.
``(2) Qualifying child.--For purposes of this section, the
term `qualifying child' means, with respect to any taxpayer for
any taxable year, an individual--
``(A) who bears a relationship to the taxpayer
described in paragraph (3),
``(B) who has the same principal place of abode as
the taxpayer for more than \1/2\ of such taxable year,
and
``(C) who meets the age requirements of paragraph
(4).
An individual shall not be treated as failing to meet the
requirements of subparagraph (B) by reason of time of birth or
death or by reason of temporary absences or other circumstances
specified in the regulations prescribed by the Secretary.
``(3) Relationship test.--
``(A) In general.--For purposes of paragraph
(2)(A), an individual bears a relationship to the
taxpayer described in this paragraph if such individual
is--
``(i) a son, daughter, stepson, or
stepdaughter of the taxpayer or a descendant of
any such relative,
``(ii) a brother, sister, stepbrother, or
stepsister of the taxpayer or a descendant of
any such relative, whom the taxpayer cares for
as the taxpayer's own child, or
``(iii) an eligible foster child of the
taxpayer.
``(B) Adopted child.--For purposes of subparagraph
(A), a child who is legally adopted, or who is placed
with the taxpayer by an authorized placement agency for
adoption by the taxpayer, shall be treated as a child
by blood.
``(C) Eligible foster child.--For purposes of
subparagraph (A), the term `eligible foster child'
means an individual--
``(i) who is placed with the taxpayer by an
authorized placement agency or by judgment,
decree, or other order of any court of
competent jurisdiction, and
``(ii) whom the taxpayer cares for as the
taxpayer's own child.
``(4) Age requirements.--For purposes of paragraph (2)(C),
an individual meets the requirements of this paragraph if such
individual--
``(A) has not attained the age of 19 as of the
close of the calendar year in which the taxable year of
the taxpayer begins,
``(B) is a student who has not attained the age of
24 as of the close of such calendar year, or
``(C) is permanently and totally disabled (as
defined in section 22(e)(3)) at any time during the
taxable year.
``(5) Special rules.--
``(A) Married dependents.--An individual shall not
be a qualifying child of a taxpayer if such individual
makes a joint return with the individual's spouse under
section 6013 for the taxable year beginning in the
calendar year in which the taxable year of the taxpayer
begins.
``(B) Individuals who support themselves.--An
individual shall not be a qualifying child of a
taxpayer if such individual provides over half of such
individual's own support for the calendar year in which
the taxable year of the taxpayer begins.
``(C) Only 1 exemption amount.--An individual who
is a qualifying child of any taxpayer shall not be
treated as the dependent of any taxpayer for purposes
of this part.
``(6) Special rule relating to 2 or more claiming
qualifying child.--
``(A) In general.--Except as provided in paragraph
(7), if an individual would (but for this paragraph) be
a qualifying child of 2 or more taxpayers for taxable
years beginning in the same calendar year, such
individual shall be treated as the qualifying child of
the taxpayer who is--
``(i) a parent of the individual, or
``(ii) if none of such taxpayers is a
parent of the individual, the taxpayer with the
highest adjusted gross income for such taxable
year.
``(B) Parents not filing joint returns.--If an
individual would (but for this paragraph) be a
qualifying child of both parents of such individual and
such parents do not file a joint return together, such
child shall be treated as the qualifying child of--
``(i) the parent with whom the child
resided for the longest period during the
taxable year, or
``(ii) if the child resides with both
parents for the same length of time during such
taxable year, the parent with the highest
adjusted gross income.
``(C) Foster children.--For purposes of this
paragraph, the taxpayer shall be treated as a parent of
any eligible foster child who has the same principal
place of abode as the taxpayer for more than one-half
of such taxable year.
``(7) Special rule for certain pre-2006 instruments.--
``(A) In general.--Notwithstanding paragraph (6), a
child who has parents who--
``(i) are divorced or legally separated
under a decree of divorce or separate
maintenance,
``(ii) are separated under a written
separation agreement, or
``(iii) live apart at all times during the
last 6 months of the calendar year,
shall be treated as being the qualifying child of the
noncustodial parent for a calendar year if the
requirements of subparagraph (B) are met.
``(B) Requirements.--For purposes of subparagraph
(A), the requirements of this subparagraph are met if--
``(i) such child would, but for this
paragraph, be the qualifying child of the
custodial parent, and
``(ii) a qualified pre-2006 instrument
between the parents is applicable to such child
for the taxable year beginning in such calendar
year.
In the case of an agreement executed before January 1,
1985, the requirements of this subparagraph are met
only if, in addition to meeting the requirements of
clauses (i) and (ii), the noncustodial parent provides
at least $600 for the support of such child during such
calendar year.
``(C) Qualified pre-2006 instrument.--For purposes
of this paragraph, the term `qualified pre-2006
instrument' means any written declaration referred to
in subsection (e)(2) (as in effect on the day before
the date of the enactment of the Child Definition
Simplification Act of 2004)--
``(i) which is executed before January 1,
2006, and
``(ii) which is not modified on or after
such date in a modification which expressly
provides that this subsection shall not apply
to such declaration.
``(D) Custodial parent and noncustodial parent.--
For purposes of this subsection--
``(i) Custodial parent.--The term
`custodial parent' means the parent with whom a
child shared the same principal place of abode
for the greater portion of the calendar year.
``(ii) Noncustodial parent.--The term
`noncustodial parent' means the parent who is
not the custodial parent.
``(E) Special rules for support.--For purposes of
this subsection--
``(i) amounts expended for the support of a
child or children shall be treated as received
from the noncustodial parent to the extent that
such parent provided amounts for such support,
and
``(ii) in the case of the remarriage of a
parent, support of a child received from the
parent's spouse shall be treated as received
from the parent.''.
(2) Conforming amendments.--
(A) Section 152 of such Code is amended by striking
subsection (e) (relating to support test in case of
child of divorced parents, etc.).
(B) Paragraph (6) of section 1(f) of such Code is
amended--
(i) in subparagraph (A) by striking
``151(d)(4)'' and inserting ``151(e)(4)'', and
(ii) in subparagraph (B) by striking
``151(d)(3)(A)'' and inserting
``151(e)(3)(A)''.
(C) Paragraph (5) of section 21(e) of such Code is
amended--
(i) by striking ``paragraph (2) or (4) of
section 152(e)'' and inserting ``section
151(c)(7)'', and
(ii) by striking ``section 152(e)(1)'' and
inserting ``section 151(c)(7)''.
(D) Sections 21(e)(6) and 129(c) of such Code are
each amended--
(i) by striking ``151(c)'' and inserting
``151(d)'', and
(ii) by striking ``151(c)(3)'' and
inserting ``151(d)(3)''.
(E) Sections 25B(c)(2)(B), 32(c)(3)(C)(ii),
152(d)(2), and 2032A(c)(7)(D) of such Code are each
amended by striking ``151(c)(4)'' and inserting
``151(d)(4)''.
(F) Sections 72(t)(7)(A)(iii) and 132(h)(2)(B) of
such Code are each amended by striking ``151(c)(3)''
and inserting ``151(d)(3)''.
(G) Clause (i) of section 642(b)(2)(C) of such Code
is amended--
(i) by striking ``151(d)'' and inserting
``151(e)'', and
(ii) by striking `` 151(d)(3)(C)(iii)'' and
inserting `` 151(e)(3)(C)(iii)''.
(H) Paragraph (1) of section 3402(f) of such Code
is amended--
(i) in subparagraph (A) by striking
``151(d)(2)'' and inserting ``151(e)(2)'', and
(ii) in subparagraph (C) by striking
``151(c)'' and inserting ``151(d)''.
(I) Subparagraph (B) of section 3402(r)(2) of such
Code is amended by striking ``151(d)'' and inserting
``151(e)''.
(J) Paragraph (1) of section 6012(a) of such Code
is amended--
(i) in subparagraph (A) by striking
``151(c)'' and inserting ``151(d)'', and
(ii) in subparagraph (D)(ii)--
(I) by striking ``151(d)'' and
inserting ``151(e)'', and
(II) by striking ``151(d)(2)'' and
inserting ``151(e)(2)''.
(K) The last sentence of section 6013(b)(3)(A) of
such Code is amended by striking ``151(d)'' and
inserting ``151(e)''.
(L) Section 7703(b)(1) of such Code is amended by
striking ``151(c)(3)'' and inserting ``151(c)(2)''.
(b) Application of Uniform Definition to Dependent Care Credit.--
(1) In general.--Section 21(b)(1)(A) of such Code is
amended to read as follows:
``(A) a qualifying child of the taxpayer (as
defined in section 151(c)) who has not attained age
13,''.
(2) Repeal of maintenance of household test.--Section
21(a)(1) of such Code is amended by striking ``who maintains a
household which includes as a member'' and inserting ``with
respect to whom there are''.
(c) Application of Uniform Definition to Child Tax Credit.--Section
24(c)(1) of such Code is amended to read as follows:
``(1) In general.--The term `qualifying child' means a
qualifying child of the taxpayer (as defined in section 151(c))
who has not attained age 17 as of the close of the calendar
year in which the taxable year of the taxpayer begins.''.
(d) Application of Uniform Definition to Earned Income Credit.--
(1) In general.--Paragraph (3) of section 32(c) of such
Code is amended to read as follows:
``(3) Qualifying child.--
``(A) In general.--The term `qualifying child'
means a qualifying child of the taxpayer (as defined in
section 151(c)).
``(B) Place of abode.--For purposes of subparagraph
(A), the requirements of section 151(c)(2)(B) shall be
met only if the principal place of abode is in the
United States.
``(C) Identification requirements.--
``(i) In general.--A qualifying child shall
not be taken into account under subsection (b)
unless the taxpayer includes the name, age, and
TIN of the qualifying child on the return of
tax for the taxable year.
``(ii) Other methods.--The Secretary may
prescribe other methods for providing the
information described in clause (i).''.
(2) Conforming amendments.--
(A) Section 32(c)(1) of such Code is amended by
striking subparagraph (C) and by redesignating
subparagraphs (D), (E), (F), and (G) as subparagraphs
(C), (D), (E), and (F), respectively.
(B) Section 32(c)(4) of such Code is amended by
striking ``(3)(E)'' and inserting ``(3)(B)''.
(C) Section 32(m) of such Code is amended by
striking ``subsections (c)(1)(F)'' and inserting
``subsections (c)(1)(E)''.
(e) Application of Uniform Definition to Credit for Health
Insurance Costs of Eligible Individuals.--Section 35(d)(1)(B) of such
Code is amended to read as follows:
``(B) a qualifying child of the taxpayer (as
defined in section 151(c)).''.
(f) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2004.
(g) Regulations.--Not later than 1 year after the date of the
enactment of this Act, the Secretary of the Treasury shall issue
regulations or other guidance defining place of abode and principal
place of abode for purposes of sections 151(c), 21, 24, 32, and 35 of
the Internal Revenue Code of 1986, as amended by this section.
SEC. 3. TREATMENT OF GOVERNMENT BENEFITS IN DETERMINING SUPPORT AND
COST OF MAINTAINING HOUSEHOLD.
(a) Dependency Exemption.--Section 152 of the Internal Revenue Code
of 1986 is amended by adding at the end the following new subsection:
``(f) Special Rule Relating to Treatment of Government Benefits in
Determining Support.--For purposes of this part, any means-tested
benefits obtained under programs described in section 6103(l)(7) or
substantially similar government programs shall not be taken into
account for purposes of determining--
``(1) whether over half of the support of an individual for
a calendar year is received from a taxpayer, and
``(2) whether over half of the cost of maintaining a
household is furnished by a taxpayer.''.
(b) Dependent Care Credit.--Section 21(e)(1) of such Code is
amended by adding at the end the following: ``Any means-tested benefits
obtained under programs described in section 6103(l)(7) or
substantially similar government programs shall not be taken into
account for purposes of determining whether over half of the cost of
maintaining a household is furnished by the individual.''.
(c) Marital Status.--Section 7703 of such Code (relating to
determination of marital status) is amended by adding at the end the
following new subsection:
``(c) Special Rule Relating to Treatment of Government Benefits in
Determining Cost of Maintaining Household.--For purposes of subsection
(b)(2), any means-tested benefits obtained under programs described in
section 6103(l)(7) or substantially similar government programs shall
not be taken into account for purposes of determining whether over half
of the cost of maintaining a household is furnished by the
individual.''.
(d) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2004.
<all>
Introduced in House
Introduced in House
Sponsor introductory remarks on measure. (CR E518)
Referred to the House Committee on Ways and Means.
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